Organization Structure of Co-operatives

The co-operative enterprise is distinct in its management structure, than other

enterprises management structure. The co-operative enterprise is composed of two
elements. It stands on two legs: i) The ownership arm. The co-operative belongs to
all its members individually and equally, and they finance the assets of the co-
operative entirely and equally.
ii) The functioning arm. The members pay for the entire costs of operation of the
co-operative, but not equally. They pay for its operation according to their
patronage in the co-operative.
Other aspects of the co-operative management, its democratic structure are as
follows: The Co-operative Enterprise general concepts, structure and
characteristics is described at the operation and management of the co-operative,
where its most important element is the members. In any other form of enterprise,
the factors of production are derived from different sources. Capital comes from
investors. Labor comes from the employed workers. Administration is provided by
a managerial staff other than the owners. In a co-operative enterprise, however, all
factors are derived from one source.... the members. In the management of other
organizations, the elements of authority can be recognized. The authority comes
from different sources such as professional or class standing, military rank,
landlord status or the possession of capital. In a co-operative enterprise, however,
the authority derives from the general meeting of the members.
In a co-operative enterprise, however, the top of the hierarchy is the members. This
broad top base delegates authority to the council, which in turn delegates to the
management. The management delegates to the manager, the one...at the bottom.
In the case of a co-operative, the organizational pyramid is "upside-down".
General Meeting there are several different types of general meeting.
i) The Inaugural General Meeting This meeting takes place in every co-
operative but once. Its role is to inaugural the functioning of the co-
operative, to discuss and authorize the 1ist of first members as wel1 as
the bylaws and other regulations of the co-operative. It must approve the
financial and operational plan for the first year's activities and elects all
the institutions of the co-operative.
 ii) The Annual General Meeting The role of this meeting is to assess all
aspects of the past year's activities and to approve financial, social and
developmental plans for the following year, as wel1 as to elect continuing
officers to the various bodies of the co-operative organization. The
annual general meeting is never presided over by the Manager of the co-
operative, but rather by a special ad-hoc committee, responsible for all
the sessions.
iii) The Extraordinary General Meeting This meeting is called only in the
event when the following subjects are to be discussed:
a) Amendment to the bylaws.
b) Acceptance of new members.
c) Expulsion of members.
d) Dissolution of the co-operative. Decisions of the extraordinary
general meeting require a special majority of 75% of the members
present, whereas at other general meetings a simple majority is sufficient.
iv) The Special General Meeting whenever the need arises during the year, this
general meeting may be called. It is presided over by the Manager of the co-
operative; though it may be summoned upon request or demand of the
management, the control committee, the audit union, the registrar of co-operatives
or 10-30% of the members, according to the bylaws of the co-operative.
Conditions for all general, meetings, regardless of type A general meeting may be
convened only when a legal quorum is present. Such a quorum consists usually of
at least 50% of the members, though the bylaws may specify any number. If no
quorum exists, the meeting is postponed to another time, from one hour to a month
later. Members should be informed about the date, time and place of the general
meeting wel1 in advance, and by appropriate means.
Careful minutes should take the discussions and decisions of every meeting. They
should include:
a) The full name of the society
b) The date of the meeting
c) The number of members present
d) The name of the chairperson presiding
e) The name of the recorder taking minutes
f) The agenda
g) The decisions
h) Any remarks of the chairperson
The general meeting is the highest authority in a co-operative, a role which
permits and demands certain specific functions.
a) It is a forum where the members can express their views freely.
b) It elects the various institutions of the co-operative.
c) It approves or expels members.
d) It makes decisions on basic issues.
e) It controls, regulates and balances the executive institutions of the cooperative
enterprise.
A mass general meeting has, however, certain inherent limitations, which point up
areas requiring very careful consideration.
a) While every issue can be presented for discussion at the general meeting, very
few are in fact discussed; since many people are unwilling to reveal themselves
before such a large, anonymous group. b) The powerful attraction of home based
radio and television, coupled with the natural desire to maintain and strengthen the
family unit cause people to be less interested in spending time at general meetings.
c) Increasing heterogeneity of co-operative members whether in professions,
branches of production, and fields of interest, economic situations or social rank
has caused increasing difficulty in getting people together for a particular purpose.
d) A general meeting may be more successful if a day is chosen when there are no
competing interests, when the agenda is not monotonous and when the points at
issue are interesting. In this way members may be encouraged to keep away from
other activities during a scheduled general meeting.
e) Good management of the meeting by the chairperson of the meeting is assumed,
as is a courteous and encouraging attitude towards participation of the members in
discussions.
Institutions of the co-operative enterprise
i) The Council
 According to co-operative legislation there exists the possibility of electing
an alternative body to the General meeting in the co-operative. This body,
the Council, is summoned mainly when the general meeting has suffered a
considerable drop in participation at all sessions. At the point when only ten
or fifteen percent of an membership is present at a general meeting,
decisions made by such a minority are hardly representative of the entire
society. A council is therefore elected body, which becomes the second
highest authority in the co-operative. It sits every three to four weeks to
discuss and decide on current issues in the co-operative, those which require
a forum wider than that merely of management. It decides as wel1 on
matters of investments, management budgets, production quotas and matters
of social and economic importance. The members of the Council are elected
for terms of two years, every year half the membership being renewed. On
one hand, management may pass to the council issues of great importance
which require a broader forum for decisions. While, on the other hand,
social problems, handled unsatisfactorily by a management committee may
be submitted to the council by the members themselves. The Council is a
relatively stable body where members feel greater personal responsibi1ity
than in the anonymity of the general meeting. The Council reflects greater
variety of opinion than the management committee and has more public
backing, though there is not the same discrete, personal approach to
members' problems as in that body.

ii) The Management Committee

The Management Committee is the highest elected executive institution in a
cooperative enterprise. Everything done in the co-operative must be
approved by the management committee. General speaking, members of this
committee are not paid for their services, and the time they devote to
meetings is limited. Every member of the cooperative may present matters
(personal problems, coop problems or public affairs) for discussion, but
only a limited number of subjects can be considered in the twice weekly
meetings of the management committee.
Duties of this committee are;
a) Approval and assignment of contracts
b) Engagement and dismissal of workers
c) Consideration of social problems
d) Decisions on matters of co-operative policy
 e) Investment in other co-operatives
f) Planning future activities of the enterprise
g) Coordinating committees work Members of the management committee
are "blind" in the sense that they depend entirely on the Manager for the
submission and explanation of issues. A central problem is therefore the
selection of this officer, for if important issues are presented with
incomplete or false information, resultant decisions may be wrong or totally
inappropriate. Management has a global responsabi1ity for all acts of the
co-operative though there may not always be an immediately discernable
connection. It must decide on the executive acts of the Manager and bears
responsabi1ity for the successes and failures of that officer. It is incumbent
on the management committee to ensure that decisions taken can in tact be
executed. The management committee must guarantee a close correlation
between theory and practice, between decision and execution. It is always
good management policy to view every decision action in the context of the
total activities of the enterprise, present and future. In this case, the
management committee must seek to discover the correlation between
current actions and their future consequences. In a way, it is like seeing not
only the forest as a whole, but also each tree as an integral part thereof.

iii) The Manager

The Manager of the co-operative is also the chairperson of all management
committee, and frequently the only paid officer in the enterprise. 24 hours a
day devotion to the co-operative is required of the person who plays this
role, as wel1 as responsibi1ity for all its operations. It is the same manager
who initiates and presides over the meetings of the management committee,
and prepares the agenda for those meetings. It is this officer who is most
directly involved in the personal problems of members of the co-operative
and of its employees. The manager represents the co-operative in other
forums, institutions and government bodies; and it is this person who is in
charge of the operation of the different departments of the organization as
well as for the preparation and execution of the socioeconomic policy of the
co-operative. It is the manager who proposes plans, executes and evaluates.

iv) The Treasurer

 The Treasurer of the co-operative is responsible for its financial
management. The person in this role has numerous specific
responsabi1ities:

a) Maintaining contacts with banks and other financial institutions dealing

with credit.
b) Collecting money and paying debts on behalf of the co-operative.
c) Representing the enterprise in different economic institutions.
d) Supervising matters of insurance.
e) Annual and monthly financial planning.

v) Control/Supervisory Committee
The control committee is elected by the general meeting of the co-operative
from among its members. It is an internal watchdog committee responsible
for examining and supervising the activities of the co-operative in order to
guarantee their being legal and in compliance with its bylaws and
constitution, as well as being financially tenable. The control committee is
completely independent from the management committee, but in no way
replaces that committee. A member of the control committee cannot at the
same time be a member in management, council or any other elected bodies
of the co-operative. Some of the specific duties of the control committee
involve supervision and checking of:

a) The general functioning of the enterprise.

b) The activities of management.
c) Various decisions and their execution.
d) The financial situation and the annual balance sheet.
e) The behavior of the different committees.
f) Complaints from members of the co-operative.